What is the difference between long-term and short-term capital gains?

Long-term gains apply when you hold an asset for more than 1 year before selling — they get preferential tax rates of 0%, 15%, or 20% depending on your income. Short-term gains apply to assets held 1 year or less — they're taxed at your ordinary income rate (10-37%). Holding for the long term can save 5-20% in taxes.

How do I calculate capital gains tax?

Subtract your purchase price + fees from the sale price to get net gain. Then apply the appropriate tax rate: long-term (held 1+ year) = 0/15/20% based on your income; short-term = your ordinary income rate. Add state tax if applicable. Our calculator does all this automatically.

What are the 2024 long-term capital gains tax rates?

For 2024 single filers: 0% on gains up to $47,025, 15% from $47,026 to $518,900, and 20% above $518,900. For married filing jointly: 0% to $94,050, 15% to $583,750, 20% above. Brackets are based on your total income including the gain.

Do I pay capital gains tax on stocks?

Yes — selling stocks at a profit generates capital gains tax. Long-term (held over 1 year) gets the preferential 0/15/20% rates. Short-term is taxed as ordinary income. Dividends are taxed separately (qualified dividends use the same LTCG rates).

The IRS treats crypto as property, not currency. Every sale, trade, or use of crypto is a taxable event. Long-term holdings (1+ year) get LTCG rates; short-term gets ordinary income rates. Even crypto-to-crypto swaps are taxable. Track your basis carefully.

What is the Net Investment Income Tax (NIIT)?

NIIT is an additional 3.8% tax on net investment income (capital gains, dividends, interest) for high-income taxpayers — those with MAGI over $200,000 single or $250,000 married. It applies on top of regular capital gains tax. Our calculator includes it automatically when applicable.

Are there exemptions for selling my home?

Yes — primary residence sales qualify for the Section 121 exclusion: $250,000 of gain tax-free for single filers, $500,000 for married filing jointly. You must have owned and lived in the home for at least 2 of the past 5 years. Investment property and second homes don't qualify.

How can I reduce capital gains tax?

Hold investments long-term (1+ year), use tax-loss harvesting to offset gains, max out tax-advantaged accounts (IRA, 401k, HSA), donate appreciated assets to charity, use installment sales, or take advantage of the 0% LTCG bracket if your income is low enough.

Capital Gains Tax Calculator

Capital gains tax depends on three things: how long you held the asset (long-term vs short-term), how much you made (the gain), and your total income (which determines your bracket). Long-term gains (held 1+ year) get preferential rates of 0%, 15%, or 20%. Short-term gains are taxed as ordinary income at 10-37%. High earners may also owe the 3.8% Net Investment Income Tax (NIIT). Our calculator handles all 2024 federal brackets for single, married filing jointly, and head of household, plus optional state tax.

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calendar_today Updated: April 2026

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receipt_longInvestment Details

Purchase Price

Sale Price

Holding (months)

Fees

Filing Status

Annual Income

State Tax %

Asset Type

paymentsTax Breakdown

Net Profit After Tax

$4,208

From $4,950 net gain

Long-term

Federal Tax

$743

Federal Rate

15%

State Tax

NIIT (3.8%)

Total Tax

$743

15% LTCG bracket

Input Values

Purchase Price

Sale Price

Holding Period (months)

Filing Status

Single

Married Filing Jointly

Head of Household

Annual Income

Fees & Commissions

tips_and_updates Tips

• Hold investments for at least 1 year + 1 day to qualify for long-term rates
• Tax-loss harvesting: offset gains with realized losses to reduce tax
• 0% LTCG bracket exists for low-to-middle earners — useful for retirees
• NIIT (3.8%) applies above $200k single / $250k married — plan around it
• Real estate primary home: $250k single / $500k married exclusion
• Wash sale rule: can't claim loss if you rebuy same security within 30 days
• Crypto is taxed like property, not currency — every trade is a taxable event
• Hold tax-inefficient assets (REITs, bonds) in IRAs to avoid annual tax drag

How to Use This Calculator

Enter purchase + sale price

How much you paid and what you sold for.

Set holding period in months

12+ months qualifies for long-term rates.

Choose filing status + income

Determines which LTCG bracket applies.

Add fees and state rate

Optional but improves accuracy.

Review tax breakdown

See federal, state, NIIT, and net profit after tax.

The Formula

Long-term gains (1+ year holding) get the lowest tax rates — 0% if you're in low tax brackets, 15% for most taxpayers, 20% for very high earners. Short-term gains (under 1 year) are taxed at your ordinary income rate, which can be much higher. This is why long-term investing is tax-efficient.

Net Gain = (Sale Price − Purchase Price − Fees);  Tax = Net Gain × Federal Rate + Net Gain × State Rate + NIIT (if applicable)

lightbulb Variables Explained

Net Gain Profit after deducting purchase cost and selling fees
Federal Rate 0/15/20% LTCG, or 10-37% ordinary STCG
State Rate Varies by state (0% in TX/FL, 13.3% in CA)
NIIT 3.8% extra for MAGI over $200k single / $250k married

tips_and_updates Pro Tips

Hold investments for at least 1 year + 1 day to qualify for long-term rates

Tax-loss harvesting: offset gains with realized losses to reduce tax

0% LTCG bracket exists for low-to-middle earners — useful for retirees

NIIT (3.8%) applies above $200k single / $250k married — plan around it

Real estate primary home: $250k single / $500k married exclusion

Wash sale rule: can't claim loss if you rebuy same security within 30 days

Crypto is taxed like property, not currency — every trade is a taxable event

Hold tax-inefficient assets (REITs, bonds) in IRAs to avoid annual tax drag

Frequently Asked Questions

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